Procurement, land acquisition weaknesses inflated Kenya’s SGR costs by Sh116bn
NAIROBI, Kenya, Nov 5 – Non-competitive procurement and irregularities in land acquisition contributed to the high cost of Kenya’s Standard Gauge Railway (SGR), with the country potentially spending up to…
A new World Bank report has revealed that non-competitive procurement and irregularities in land acquisition significantly inflated Kenya's Standard Gauge Railway (SGR) costs by up to Sh116 billion. The report estimates that Kenya could have saved up to $900 million in initial construction costs if the Mombasa-Nairobi railway had been built at the same cost per kilometer as Tanzania's Dar es Salaam-Dodoma line.
The World Bank's figures show that Kenya's SGR construction cost is $7.6 million per kilometer, compared to $5.7 million for Tanzania's electrified railway and $5.3 million for the Djibouti-Addis Ababa line. The report highlights governance challenges such as preference for direct contracting over competitive tendering, land speculation, and alleged fraud involving land titling, valuation, and compensation payments as contributing to the higher project costs.
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